Risks are part of the business world - identifying, quantifying and developing strategies to mitigate these risks will be a high priority for any business, and their successful resolution will give competitive advantage.
Repurchase Agreements (Repo)
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This is the rate at which Central Bank absorbs excess liquidity in the market.
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Repo offers the flexibility to invest short-term I long-term with the option of investing for even one day.
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Repo is fully backed by Treasury Bills & Bonds.
Reverse Repurchase Agreement (ReRepo)
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This is the rate at which Central Bank lends Rupees to banks against Treasury Bills / Bonds.
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With Rerepo you can place the Treasury Bills, Bonds or Repos that have already been purchased as security and borrow against them.
Benefits
No Debit Tax
No further taxation in the hands of individual investors
Government Securities
Government Securities are of two types:
(1) Treasury Bills
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Tenders will be called by Central Bank to issue Treasury Bills.
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Bids are invited from Primary Dealers & should be made through the electronic network system.
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At each tender Bank has to buy a minimum amount of Rs.5 Mn worth TIB from Central Bank. Tenders should be in multiples of Rs Million.
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Application forms for Treasury Bills, Bonds & Repo's can be downloaded & completed by prospective investors & e-mailed to HNBSL, on the following address - hnbsl@hnb.lk
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Treasury Bills are issued for 3,6 and 12 months.
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T/Bs are discounted instruments i.e. the investor pays the discounted value (investment value) and receives the face value on maturity.
